Wind Energy Tax Credit Extended for Two Years

The wind energy Production Tax Credit (PTC), considered vital by the United States wind energy industry for continued growth, has been extended for two years as part of an economic stimulus package recently approved by both houses of Congress and signed by President George W. Bush.

WASHINGTON, D.C. 2002-03-14 [] The PTC, which had expired December 31, 2001, will be extended retroactively from that date to December 31, 2003 although wind energy organizations are seeking a full five-year extension contained in the larger energy bill now being debated in the Senate. The bill passes both houses of Congress with overwhelming support. House members approved the package 417-3 with the Senate approving the same package by a vote of 85-9. “The American wind energy industry welcomes Congressional passage of a two-year extension of the wind energy production tax credit,” said American Wind Energy Association executive director Randall Swisher. “This action by Congress and the expected signature of President Bush means that about US$3 billion in wind energy investments forecast over the next several years are now back on track across the country.” According to AWEA, several projects across the country were on hold due to the delay in extension of the PTC with hundreds of industry employees furloughed. For example: California-based, Zond Wind Turbines, a manufacturer near Bakersfield, have furloughed 85 skilled workers because the delay caused a halt in orders for new turbines; Trinity Industries of Dallas, Texas, a builder of wind turbine towers, furloughed 200 workers because of the lack of the PTC extension. At DMI Industries in North Dakota, the PTC extension means hiring more than 50 employees that were on hold along with the PTC. “We are definitely hiring those people plus more,” said Steve Wenzel of DMI’s Business Development department. “It started Friday when the stimulus bill passed.” Wenzel said there is a 10 to 12 week materials lead time, but the company will hire the new employees to get them up to speed for a planned expansion within the fast growing company. According to Wenzel, the company will double the amount steel that they transform from raw material to wind turbine towers this year reaching two million tons per week. The PTC delay came as the U.S. wind industry set installation records, installing more than twice as much new generating capacity as in any previous year-almost 1,700 MW. Texas, which enjoys strong state laws that encourage Renewable Energy use, installed 915 MW of wind capacity in 2001-more than the previous record for the entire country. Wenzel of DMI said the industry is unlikely to reach the record setting pace of installation this year due to the nearly three month delay in extension of the PTC. “The industry was virtually shut down,” Wenzel said. “We are already two months behind.”
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